Yesterday, legislative leaders claimed that the conference budget would include $251 million in recurring funding for K-12 public education. However, budget watchers of many stripes were perplexed to see a net increase of just $62 million in the public schools budget. Following up on what I wrote yesterday about the state budget not having enough recurring dollars to go around without a tax increase, here’s an educated guess as to how the leaders justified their claim. The key is looking only at the recurring expansion (new spending) items and ignoring the cuts.

The $20.2 billion conference budget released late yesterday brings together the Senate and House plans to fund state investments at 11.4 percent below pre-recession levels and at a new all-time historic low of 5.47% of state personal income. Here are some of the key details from this budget proposal that will likely move to the floor as early as tomorrow for a vote.

K-12 Education

Increases public education budget by a net $62.4 million in recurring funds, or about 0.8% over continuation. This doesn’t include the $85 million in reserves for LEAs to support a 1.2% salary increase.

Partially restores the LEA adjustment by $143 million, of which $16.4 million is paid out of education lottery surplus (one-time) dollars. This line leaves the LEA Adjustment at a total of about $359.8 million, which is about $63 million less than the current year ($429 million)

Cuts textbook funding by $4.3 million (new item)

Includes the majority of the Excellence in Public Schools Act, appropriating $27 million in recurring dollars to fund it (Senate budget) Read More

At 11 a.m. today, legislative leaders held a press conference at the General Assembly to discuss their freshly-minted budget compromise – but lo and behold, no budget documents were provided. Today’s coverage of the budget has been dominated by discussion of what the leaders said, rather than analysis of the actual budget plan which hasn’t been released to the public. However, the breadcrumbs of information dropped by Sen. Berger and Speaker Tillis in their news conference are just enough to pose some stark questions that, as yet, have gone unasked – specifically, where is all this recurring money coming from when we know there won’t be any tax increases? Read More

Call it round two: as we did for the House budget, BTC has taken a close look at the Senate budget’s availability statement to break out where they raise, and spend, General Fund dollars before the budget negotiation itself even begins.

The state K-12 education budget is massive and a bit convoluted – especially with one of the largest budget pressures on state public schools unaccounted for in the state budget (the loss of federal recovery dollars) and the other just plain weird accounting (the LEA Adjustment). Both topics have come up in the news, so here are the basics on what these things are and why addressing them is such a big deal for North Carolina’s schools.

This talk of an LEA Adjustment is driving me crazy. What is it, how big is it, and how does it work?

The LEA adjustment requires North Carolina school districts to identify and implement a cut to their share of state funding on a recurring (yearly) basis. The size of each LEA’s adjustment is determined based on their average daily membership, or ADM. When deciding how to cut their budgets each year, LEAs have maximum flexibility but must maintain class size requirements in grades K-3. Rather than writing a dull history of how this cut has grown deeper and deeper over the course of the Great Recession and recovery, here’s the history of the LEA Adjustment in one chart: